Moody's lowers Ukraine to Caa1

Moody's Investors Service said it downgraded Ukraine's government bond rating to Caa1 from B3 and placed the rating on review for downgrade.

Moody's said that among other factors, this action was prompted by: Heightened concerns over Ukraine's external liquidity position. The country's foreign-exchange reserves are already at a very low level and pressure on reserves is likely to rise due to increased domestic demand for foreign currency in the autumn and significant foreign-currency-denominated debt repayments until end-2014; and increased downside risk related to future negotiations with the IMF, which has negative implications for external liquidity and progress on domestic economic reform.

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